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Complex Financial Systems: Dynamics, Risk, and Resilience
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Complex Financial Systems: Dynamics, Risk, and Resilience

A Special Issue of Systems (ISSN 2079-8954) belonging to the section "Systems Practice in Social Science".

Deadline for manuscript submissions: 30 September 2026 | Viewed by 5496

Editors

Dr. Tristan Lim

E-Mail Website
Guest Editor
SUSS Academy, Singapore University of Social Sciences (SUSS), Singapore 599494, Singapore
Interests: digital ecosystems; AI/ML in finance; socio-technical systems; behavioural and sentiment-driven markets; sustainability transitions; system dynamics; risk architectures
Dr. Zhiyuan Wang

E-Mail Website
Guest Editor
School of Business, Singapore University of Social Sciences (SUSS), Singapore 599494, Singapore
Interests: multi-criteria decision-making; system-level optimisation; surrogate modelling; AI-enabled analytics; ESG-XAI; modelling of system trade-offs
Special Issues, Collections and Topics in MDPI journals
Dr. Chong Guan

E-Mail Website
Guest Editor
SUSS Academy, Singapore University of Social Sciences (SUSS), Singapore 599494, Singapore
Interests: digital ecosystems; FinTech; socio-technical systems; artificial intelligence; platform economics; digital transformation; information systems

Special Issue Information

Dear Colleagues,

Financial markets and institutions are becoming increasingly interconnected, digitalised, and shaped by rapidly evolving technologies and behavioural forces. Developments in algorithmic trading, decentralised finance, digital assets, ESG-driven capital flows, and AI-enabled decision systems mean that finance must be understood as a complex, adaptive, and socio-technical system—one influenced by the interactions among people, technologies, regulations, data flows, and global events.

This Special Issue, “Complex Financial Systems: Dynamics, Risk, and Resilience”, invites scholarly contributions that examine financial phenomena through the lens of systems science and systems engineering. We welcome submissions from finance, economics, information systems, management, data science, engineering, sustainability studies, and related fields. Empirical, theoretical, conceptual, and methodological papers are all suitable, provided they adopt a systems-oriented perspective aligned with the journal’s aims.

Suggested themes include, but are not limited to, the following:

  • Systemic risk propagation, contagion, and stress transmission;
  • Networked financial markets, agent-based modelling, and hybrid simulations;
  • Behavioural, sentiment-driven, and feedback-loop market dynamics;
  • Digital finance ecosystems, platform intermediation, and cyber-physical infrastructures;
  • AI-augmented risk management, explainable decision systems, and model governance;
  • ESG factors, sustainability transitions, and complex capital-flow reconfigurations;
  • Governance, regulation, and policy as system-shaping mechanisms;
  • Resilience engineering, scenario modelling, and system design for financial stability.

We look forward to receiving your contributions.

Dr. Tristan Lim
Dr. Zhiyuan Wang
Dr. Chong Guan
Guest Editors

Manuscript Submission Information

Manuscripts should be submitted online at www.mdpi.com by registering and logging in to this website. Once you are registered, click here to go to the submission form. Manuscripts can be submitted until the deadline. All submissions that pass pre-check are peer-reviewed. Accepted papers will be published continuously in the journal (as soon as accepted) and will be listed together on the special issue website. Research articles, review articles as well as short communications are invited. For planned papers, a title and short abstract (about 250 words) can be sent to the Editorial Office for assessment.

Submitted manuscripts should not have been published previously, nor be under consideration for publication elsewhere (except conference proceedings papers). All manuscripts are thoroughly refereed through a single-anonymized peer-review process. A guide for authors and other relevant information for submission of manuscripts is available on the Instructions for Authors page. Systems is an international peer-reviewed open access monthly journal published by MDPI.

Please visit the Instructions for Authors page before submitting a manuscript. The Article Processing Charge (APC) for publication in this open access journal is 2400 CHF (Swiss Francs). Submitted papers should be well formatted and use good English. Authors may use MDPI's English editing service prior to publication or during author revisions.

Keywords

  • complex financial systems
  • systemic risk
  • socio-technical finance
  • financial networks
  • system dynamics
  • behavioural market dynamics
  • digital and algorithmic finance
  • AI/ML decision systems
  • sustainability transitions
  • complex adaptive systems

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Published Papers (7 papers)

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Research

19 pages, 866 KB  
Article
Macro-Financial Volatility Exposure and Corporate Resilience: The Dual Contingencies of Resource-Capability Alignment and Cognition-Learning Adaptation
by Guilin Yang and Wanping Yang
Systems 2026, 14(9), 1121; https://doi.org/10.3390/systems14091121 - 8 Sep 2026
Viewed by 183
Abstract
Amid heightened global economic uncertainty, enhancing corporate capacity to resist systemic risks is crucial. This study examines how exposure to macro-financial volatility affects organizational resilience among Chinese A-share listed firms. Empirical tests reveal that macro-financial volatility elevates stock price crash risk in baseline [...] Read more.
Amid heightened global economic uncertainty, enhancing corporate capacity to resist systemic risks is crucial. This study examines how exposure to macro-financial volatility affects organizational resilience among Chinese A-share listed firms. Empirical tests reveal that macro-financial volatility elevates stock price crash risk in baseline market evaluations, thereby eroding organizational resilience, while extended specifications display consistent directional patterns across varying levels of statistical support. Moderation analysis indicates that external volatility transmission involves distinct structural and processual contingencies. Specifically, contrary to conventional views treating internal fit as a protective buffer, high resource-capability alignment induces structural rigidity that amplifies this eroding effect. Conversely, processual adaptation through organizational cognition and organizational learning exhibits time-lagged protective effects that cushion crash risk over time. Heterogeneity analyses show that internal liquid reserves, intangible assets, regional financial depth, and urban scale effectively buffer firm-level operations against macro shocks. Full article
(This article belongs to the Special Issue Complex Financial Systems: Dynamics, Risk, and Resilience)
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42 pages, 1501 KB  
Article
Related-Party Transaction Networks and Corporate Credit Risk in Complex Financial Systems: Evidence from Network Characteristics and Local Configurations
by Jiawei Xu and Haohua Li
Systems 2026, 14(9), 1114; https://doi.org/10.3390/systems14091114 - 7 Sep 2026
Viewed by 285
Abstract
Firms are embedded in transaction systems whose organization can generate both coordination benefits and relational exposure. Using disclosed related-party transactions (RPTs), we construct annual weighted bipartite networks for 2674 Chinese A-share listed firms and examine 26,264 RPT-active firm-year observations from 2003 to 2024. [...] Read more.
Firms are embedded in transaction systems whose organization can generate both coordination benefits and relational exposure. Using disclosed related-party transactions (RPTs), we construct annual weighted bipartite networks for 2674 Chinese A-share listed firms and examine 26,264 RPT-active firm-year observations from 2003 to 2024. The analysis distinguishes three firm-level dimensions—relationship scale, transaction concentration, and projected shared-counterparty position—from local bipartite microstructures. The firm-level evidence reveals a double-edged pattern: broader and more valuable RPT relationships are associated with lower Merton and KMV distance to default (DD), and projected degree is associated with lower Merton DD, whereas a higher top-three-related-party share is associated with higher KMV DD. Direction-specific estimates reinforce this distinction. Scale is negatively associated with DD on both the seller/provider and buyer/recipient sides, concentration is generally positive (especially on the buyer/recipient side), and seller/provider projected degree is negatively associated with KMV DD. At the local level, closed 2 × 2 presence and intensity are negatively associated with Merton DD, while simple degree-based forms and shared-counterparty bridges provide less stable differentiation. Observed closure substantially exceeds degree-sequence-preserving randomized benchmarks, and excess closure remains negatively associated with Merton and Bharath–Shumway DD after relationship opportunities and counterparty popularity are controlled. The results establish transaction scale, value allocation, projected reach, and repeated local sharing as complementary signals for structure-sensitive credit risk monitoring in complex transaction systems. Full article
(This article belongs to the Special Issue Complex Financial Systems: Dynamics, Risk, and Resilience)
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55 pages, 2302 KB  
Article
Consumer Complaints as Infrastructure Failure Signals: Systemic Vulnerability Architectures and a Failure Ecosystem Framework for Consumer Finance
by Tristan Lim, Zhiyuan Wang, Chong Guan and Poh Ling Neo
Systems 2026, 14(9), 1073; https://doi.org/10.3390/systems14091073 - 1 Sep 2026
Viewed by 204
Abstract
Consumer financial services depend on interconnected institutions, products and regulatory processes, yet complaints about failures within this infrastructure are usually analysed as individual cases or grouped using administrative categories. This study examines whether large-scale complaint data can instead reveal recurring structures of failure. [...] Read more.
Consumer financial services depend on interconnected institutions, products and regulatory processes, yet complaints about failures within this infrastructure are usually analysed as individual cases or grouped using administrative categories. This study examines whether large-scale complaint data can instead reveal recurring structures of failure. Using 4.7 million complaints submitted to the U.S. Consumer Financial Protection Bureau between 2011 and 2024, we develop a Failure Ecosystem Framework that groups complaint narratives by semantic similarity and traces the institutions and products associated with each group over time. The analysis identifies 16 failure ecosystems, spanning credit reporting, identity theft, debt collection, payment disputes, mortgage servicing and digital finance. These ecosystems differ substantially: some failures concentrate among a few institutions while others are widely distributed, and in many, the same institution–product combinations recur from year to year. Greater concentration is not systematically associated with better or worse complaint outcomes, and the evidence is least conclusive for monetary compensation. Corrective outcomes vary more across failure types than with concentration, indicating that market structure alone cannot explain how consumer failures are remedied. Complaints can therefore reveal persistent structures of failure that case-by-case review does not expose, supporting system-level monitoring of vulnerabilities in consumer finance. Full article
(This article belongs to the Special Issue Complex Financial Systems: Dynamics, Risk, and Resilience)
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26 pages, 747 KB  
Article
Green M&A, Green Finance, and Corporate Market Value Enhancement: A Signaling Game-Theoretic and Empirical Analysis
by Xi Chen, Chunai Ma, Wanting Wu and Fuying Hao
Systems 2026, 14(6), 641; https://doi.org/10.3390/systems14060641 - 4 Jun 2026
Viewed by 885
Abstract
The low-carbon transition is reshaping firms’ strategic behavior and financial resource allocation, yet the mechanisms linking green mergers and acquisitions (green M&A), green credit, and market value remain insufficiently understood. Existing studies recognize the signaling role of environmental actions but often lack a [...] Read more.
The low-carbon transition is reshaping firms’ strategic behavior and financial resource allocation, yet the mechanisms linking green mergers and acquisitions (green M&A), green credit, and market value remain insufficiently understood. Existing studies recognize the signaling role of environmental actions but often lack a formal game-theoretic framework to explain how green M&A conveys information to financial institutions and capital markets. This study fills this gap by developing a signaling game model between firms and financial institutions to analyze how green M&A affects market value directly and indirectly through credit resource flow. Using panel data of Chinese A-share listed companies from 2013 to 2023, we examine the observable implications derived from the model: the value effect of green M&A, its association with green credit allocation, and the mediating role of green credit. The results show that green M&A is associated with higher market value and greater green credit allocation, while green credit serves as a partial transmission channel. These effects are weakened by internal climate-risk exposure and climate-policy uncertainty, and strengthened by media attention. This study develops a unified theoretical–empirical framework for understanding the economic consequences and financial transmission mechanisms of green M&A, offering implications for corporate green transformation and green-finance resource allocation. Full article
(This article belongs to the Special Issue Complex Financial Systems: Dynamics, Risk, and Resilience)
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28 pages, 1966 KB  
Article
Risk Propagation and System Resilience in Sustainable–Digital Finance: A Time–Frequency Higher-Order Moment Analysis of Green Finance, Green Cryptocurrency, and Non-Green Cryptocurrency Markets
by Junda Wu, Jian Yao and Jiajing Sun
Systems 2026, 14(6), 628; https://doi.org/10.3390/systems14060628 - 1 Jun 2026
Cited by 2 | Viewed by 381
Abstract
This study examines risk connectedness among sustainable and digital assets from 24 September 2019 to 26 May 2025. The sample contains three green finance indices, five literature-based green cryptocurrencies, and five literature-based non-green/conventional cryptocurrencies. We estimate conditional volatility, skewness, and kurtosis using the [...] Read more.
This study examines risk connectedness among sustainable and digital assets from 24 September 2019 to 26 May 2025. The sample contains three green finance indices, five literature-based green cryptocurrencies, and five literature-based non-green/conventional cryptocurrencies. We estimate conditional volatility, skewness, and kurtosis using the GARCHSK model and then apply time-domain, frequency-domain, and TVP-VAR connectedness frameworks to identify how shocks are shared across assets, moments, and investment horizons. The results show that the sustainable–digital finance system is strongly connected but unevenly organized. In the baseline static estimates, total connectedness is 75.87 for volatility, 65.11 for skewness, and 77.94 for kurtosis. Volatility and kurtosis connectedness are mainly long-run phenomena, whereas skewness connectedness is split almost evenly between short- and long-run components. Green finance assets mainly occupy net receiver positions in the estimated connectedness network, while several cryptocurrencies, including some classified as green in the literature, appear as net transmitters of volatility or tail-risk connectedness. Additional robustness checks using a monthly frequency cutoff and a pre-/post-Ethereum Merge split support the main horizon-level interpretation while also showing that the strength of connectedness changes across regimes. The findings provide connectedness-based diagnostics for portfolio design, system-level risk monitoring, and governance of sustainable–digital finance. They should be interpreted as evidence on forecast-error variance connectedness and relative transmitter/receiver roles rather than as structural causal estimates or direct measures of systemic losses. Full article
(This article belongs to the Special Issue Complex Financial Systems: Dynamics, Risk, and Resilience)
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29 pages, 3147 KB  
Article
Stablecoins, Risk Transmission and Systemic Reconfiguration in a Fragmented USD Access System: Evidence from Quantile Time-Frequency Analysis
by Junda Wu, Jiajing Sun, Haoyuan Feng and Fei Long
Systems 2026, 14(5), 562; https://doi.org/10.3390/systems14050562 - 15 May 2026
Viewed by 727
Abstract
In high-inflation economies, stablecoins are increasingly becoming infrastructural channels through which households and firms access U.S.-dollar value outside traditional financial arrangements. We study Argentina as a fragmented USD access system composed of a regulated official channel, an informal parallel channel (the Blue Dollar), [...] Read more.
In high-inflation economies, stablecoins are increasingly becoming infrastructural channels through which households and firms access U.S.-dollar value outside traditional financial arrangements. We study Argentina as a fragmented USD access system composed of a regulated official channel, an informal parallel channel (the Blue Dollar), and platform-based USDT channels on Binance and Bitso. Using a quantile time-frequency connectedness framework, we estimate reduced-form dynamic dependence and spillover patterns across these interdependent subsystems under normal and extreme market states and across short- and long-term horizons. Four main findings emerge. First, system-wide connectedness is dominated by short-term transmission and rises sharply during policy regime transitions, particularly around the relaxation of capital controls. Second, under normal conditions, stablecoin markets behave as early-moving net spillover transmitters, whereas the Blue Dollar and the official rate primarily absorb shocks. Third, connectedness exhibits a symmetric U-shaped pattern across quantiles, indicating that tail events intensify cross-channel dependence regardless of shock direction. Fourth, under upper-tail extreme market states, the official rate becomes a net transmitter in the long-term frequency band, implying that major devaluation episodes can temporarily reconfigure the system’s transmission architecture, even though stablecoin channels remain important in overall connectedness. These findings should be interpreted as evidence of dynamic dependence rather than structural causality. They suggest that digital dollarization does not simply add another trading venue; it increases boundary permeability, reshapes information hierarchy, and changes the monitoring problem faced by authorities in fragmented financial systems. Full article
(This article belongs to the Special Issue Complex Financial Systems: Dynamics, Risk, and Resilience)
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55 pages, 4838 KB  
Article
Can Regulatory Sandboxes Enhance Financial System Resilience: A Systems Perspective on Regional Risk Mitigation Evidence from China
by Jiajia Yan and Yuxuan Zhou
Systems 2026, 14(2), 185; https://doi.org/10.3390/systems14020185 - 8 Feb 2026
Cited by 2 | Viewed by 1578
Abstract
Financial systems are quintessential complex adaptive systems, where stability emerges from the dynamic interactions among multiple subsystems and regulatory components. Grounded in systems theory, this study re-frames the establishment of China’s fintech regulatory sandbox as a systemic intervention within the broader financial governance [...] Read more.
Financial systems are quintessential complex adaptive systems, where stability emerges from the dynamic interactions among multiple subsystems and regulatory components. Grounded in systems theory, this study re-frames the establishment of China’s fintech regulatory sandbox as a systemic intervention within the broader financial governance framework. Utilizing this policy as a quasi-natural experiment, we employ a difference-in-differences (DID) model integrated with spatial econometric modeling to evaluate its impact on regional financial system risk—an emergent property of the system. The benchmark regression results indicate that this systemic policy innovation significantly enhances regional financial resilience, with effects that are both continuous and robust. Mechanism tests, analyzed through the lens of subsystem coordination, demonstrate that the policy curbs systemic risk by improving the synergy within economic inner cycles, outer cycles, and their dual-cycle integration, thereby optimizing the system’s internal structure and feedback loops. Further analysis reveals a significant negative spatial spillover effect, evidencing the policy’s role in reshaping inter-regional systemic linkages: it reduces financial risk in both implementing and neighboring regions, with the effect’s intensity following an inverted U-shaped pattern relative to distance. Heterogeneity analysis shows that the policy’s inhibitory effect varies significantly across different systemic configurations, including risk circulation patterns, macro–micro risk perspectives, financial inclusion coverage, government–market relationships, and the north–south regional divide. These findings provide critical insights for developing synergistic macro-prudential and micro-behavioral regulatory mechanisms, contributing to a more robust and adaptive financial security framework from a systems governance perspective. Full article
(This article belongs to the Special Issue Complex Financial Systems: Dynamics, Risk, and Resilience)
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